USSD Debt Crisis: NCC Orders Disconnection of Nine Banks

Due to outstanding payments, the Nigerian Communications Commission has given telecom operators permission to disconnect the Unstructured Supplementary Service Data codes linked to nine financial institutions.

Reuben Muoka, the Director of Public Affairs of NCC, signed a public notice on Tuesday that contained this directive.

According to the telecom authority, impacted banks face losing their USSD codes if they don’t pay their outstanding debts by January 27, 2025.

If the debts are not settled, these codes—which are necessary to provide mobile banking services—may be transferred to other applicants.

According to the commission, nine of the eighteen financial institutions had failed to comply with regulatory requirements as of Tuesday’s close of business.

Although other banks have paid off their obligations, it was reported that the financial institutions owed more than N200 billion in total.

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The regulator did not, however, reveal the exact amount of debt that the impacted banks currently owe.

A protracted financial dispute between the banks and telecom carriers is indicated by the NCC, which claims that some of the outstanding invoices have not been paid since 2020.

The notice stated in part that “the nine institutions listed below have failed to significantly comply with the directives in the Second Joint Circular of the Central Bank of Nigeria and the commission dated December 20, 2024, for the settlement of outstanding invoices due to MNOS, some since 2020,” based on information provided to the commission as of close of business on Tuesday, January 14, 2025, of a total of 18 financial institutions.

The regulator pointed out that banks cannot meet the good standing conditions for the renewal of the USSD codes that the commission has assigned them if they do not follow the CBN-NCC joint circular.

“The commission wishes to notify consumers that they may not be able to access the USSD platform of the affected financial institutions starting on January 27, 2025, in accordance with its consumer protection mandate,” it continued.

Fidelity Bank Plc, First City Monument Bank, Jaiz Bank Plc, Polaris Bank Limited, Sterling Bank Limited, United Bank for Africa Plc, Unity Bank Plc, Wema Bank Plc, and Zenith Bank Plc are among the financial institutions that are impacted.

Among other USSD codes, 770, 919, and 822 are impacted.

The NCC emphasized that the financial institutions had received adequate notice of the urgent compliance requirement and cautioned that if the problems are not fixed, customers may experience service interruptions.

This move underscores the persistent conflicts that have existed for years between financial institutions and telecommunications firms over outstanding obligations related to the USSD.

According to CBN data, between January and June 2024, 252.06 million transactions totaling N2.19 trillion were made via USSD.

Compared to 2023, when 630.6 million transactions totaling N4.84 trillion were made using USSD codes, this indicates a notable increase.

USSD, which was first created by telecom companies for purposes such as airtime subscriptions and purchases, has grown to be a vital instrument in the banking industry, providing consumers with financial services without the need for an Internet connection.